Cordea Savills Student Hall Fund completes GBP28m Edinburgh development
Cordea Savills has completed the development of Sugar House Close halls of residence in central Edinburgh on behalf of its Student Hall Fund.
The fund developed the halls after purchasing the site and buildings of a redundant brewery for an initial sum of GBP8.25m in May 2011.
The development is in line with the fund’s stated strategy of increasing its exposure to UK capital cities and high calibre universities.
Acquired as a forward funding project with developer Watkin Jones, Sugar House Close has been built to a high specification to provide 121 ensuite rooms, 151 studios and 28 “twodios”. Completed in August 2012, it is now fully let having welcomed 300 University of Edinburgh students for the academic intake in September. With its close proximity to the university, it has proved a favourite among students, offering excellent facilities within a few minutes’ walk of the Royal Mile.
The property benefits from a flexible planning consent that allows it to be used as an “aparthotel” during the Edinburgh Festival and outside of term time. It is anticipated that the asset will deliver a net distribution yield of 6.5 per cent p.a.
Patrick Carr, fund director, says: “Sugar House Close has proved to be an excellent acquisition for the fund. It is a positive and accretive addition to the portfolio, providing high quality accommodation in a prime Edinburgh location.
“Overall, the fund maintains a strong occupation rate for the 2012/13 academic year at 93.3 per cent and our focus remains on delivering a solid and consistent income stream to our investors.”